The Best Stock to Own This Quarter

SWKS is a historical outperformer in January and the first quarter

Managing Editor
Jan 2, 2020 at 12:26 PM
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It's 2020, and there's a new year, a new month, a new quarter, and a new decade to all look forward to. One stock in particular to monitor amid all this "newness" is Skyworks Solutions Inc (NASDAQ:SWKS), as the chipmaker has not only been a top performer in the first quarter, but for the month of January as well.

More specifically, data from Schaeffer's Senior Quantitative Analyst Rocky White shows SWKS has averaged a gain of almost 23% in the first quarter over the past 10 years, and has finished the three-month period in positive territory all 10 times. That's easily the best of the 25 stocks tracked outpacing second-place Fortinet's (FTNT) average 17.3% quarterly return for the same time period. And in January, White's data shows Skyworks stock with an average return of 9.6%, with eight out of the 10 years positive.

Best Stocks First Quarter

The shares are fresh off a Dec. 26 record high of $122.89, with the subsequent pullback finding support at their 10-day moving average. The equity has now doubled in the last 12 months, yet 11 of 21 brokerages in coverage still maintain a tepid "hold" rating.

For those looking to speculate on the chip stock's next move with options, now looks to be the perfect time. The security's Schaeffer's Volatility Index (SVI) of 28% is in the 8th percentile of its annual range, meaning options players are pricing in incredibly low volatility expectations right now.

Plus, SWKS's Schaeffer's Volatility Scorecard (SVS) sits at 95 (out of 100), indicating the equity has tended to exceed option trader's volatility expectations during the past year. 


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